From the author of

From the author of

Scams aren’t new; they just take on new forms as the world changes.
Steve Weisman points out why and how scammers get to us.

Scams are an old story that’s written anew every day. Some scams have
been around for at least a century, such as the
Spanish prisoner scam,
which has evolved into the
Nigerian letter scam
of today. Many newer scams utilize the latest in technological advancements to
make it ever easier to part fools from their money. And not just
fools—careful, intelligent people also fall prey to the many scams that
pervade our everyday life. Scam artists, the rare criminals justifiably referred
to as "artists," often have a knowledge of psychology that would make
Sigmund Freud proud. These criminals know just which buttons to push to appeal
to our fears, friendships, charitable instincts, compassion, optimism, greed,
and desire for quick-and-easy solutions to life’s problems.

Almost everything we do can be adapted to a scam. Fertile ground for scammers
includes phony lotteries, charities, telephone services, healthcare
(particularly weight-loss programs), travel services, government programs,
scholarships, employment opportunities, dating services, and of course
investments. And then there’s the mother lode of today’s scams:
identity theft. Identity theft has become a worldwide epidemic of varying scams
that carry the potential to empty your bank accounts, ruin your credit, or even
send you to jail for a crime someone committed using your name. Regardless of
how careful you think you are, you can become a victim of identity theft when
your personal information is accessed from sources that may legitimately have
this information, but fail to protect the security of this critical information.
Steven Spielberg, Martha Stewart, Oprah Winfrey, Ross Perot, and even Warren
Buffet have all been targeted in this fashion.

Scams Are Always in Season

During the holidays, when people are in a charitable mood, there’s never a shortage of legitimate-looking phony charities that are more than eager to take your money. You owe it to yourself to take the steps necessary to confirm that any charity you’re considering not only is legitimate. Additionally, you should learn just how much of your contribution is actually used for charitable purposes and how much goes to administrative purposes. (The proportional percentages in even some legitimate charities may astound you.)

During tax season, it’s not just the IRS that’s seeking your money, but also scammers. Phony notices and fraudulent tax schemes not only can cause you to lose money, but even subject you to possible criminal sanctions.

Much has been written about the problems in the sub-prime mortgage market and an increasing rate of mortgage foreclosures. But where others see problems, scammers see opportunity. Whatever the problem—health issues, relationships, financial difficulties—a scammer is there with an offer to "help" that ultimately just makes things worse. In one particular foreclosure scam, con artists tell homeowners in jeopardy that they can avoid foreclosure by transferring an interest in their home to a third party. The third-party con artist walks away with the money, and the foreclosure is unaffected. Scammers prey on us when we’re at our weakest and most vulnerable.